FDM gets an increased offer to take the business private and keep the family sweet

Rod Flavell and his wife Sheila have had to woo some familiar faces with their
increased £31.3m offer backed by Inflexion Private Equity to take FDM
private.

By Helia Ebrahimi

6:39PM BST 24 Aug 2009

A man, his wife, his ex and her brother - not many bid scenarios have a cast of players as colourful as IT services group FDM.

But the management of the Aim listed company, led by founder and chief executive Rod Flavell and including his current wife Sheila, have had to woo some familiar faces with their increased £31.3m offer backed by Inflexion Private Equity to take the business private.

Mr Flavell's ex-wife Jacs - who still uses her married name on her facebook page - owns 9.51pc of FDM's shares, while his ex-brother-in-law Julian Divett has 4.71pc and Julian and Jacs father Brian Divett owns 10.15pc.

Mr Flavell started the company in 1990 with his then wife, Jacs and her brother, running the business out of the family attic. Then the company's first employee, Sheila, stayed only five months, but when she returned she had become the second Mrs Flavell.

Mr Flavell, who has a 9.1pc holding, last year admitted the connections were a little unusual but insisted relations were "perfectly civilised". After offering 120p a share back in June, he has returned with an improved 135p-a-share bid, valuing his former wife and in-laws total holdings at £7.6m.

On Monday, the group said that in view of the revised proposal a green light had now been given for full due diligence. While the company noted there was no guarantee an offer would be made, the shares jumped 13 to 125½p.

FDM provides services to more than 200 clients including Barclays, Goldman Sachs, and BBC Worldwide, in areas such as application support and training.

Its latest annual results showed it raised its total dividend by 30pc to 3½p a share following a 23pc increase in profits to £5.3m on sales of £52.2m. However, in a pre-close statement last month it warned its clients buying decisions were taking longer and contracts shorter making predictability more difficult.